FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


(X)               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 1997

                                       OR

( )                TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to


                             Commission file number
                                                     0-21558


                           CNL Income Fund XII, Ltd.
             (Exact name of registrant as specified in its charter)


           Florida                            59-3078856
    (State or other juris-                 (I.R.S. Employer
   diction of incorporation               Identification No.)
      or organization)


400 E. South Street, #500
     Orlando, Florida                              32801
   (Address of principal                         (Zip Code)
     executive offices)


Registrant's telephone number
   (including area code)                        (407) 422-1574


Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.   Yes     X      No


<PAGE>









                                    CONTENTS






Part I                                                        Page

  Item 1.  Financial Statements:

             Condensed Balance Sheets                         1

             Condensed Statements of Income                   2

             Condensed Statements of Partners' Capital        3

             Condensed Statements of Cash Flows               4

             Notes to Condensed Financial Statements          5

  Item 2.  Management's Discussion and Analysis
             of Financial Condition and
             Results of Operations                            6-8


Part II

  Other Information                                           9


<PAGE>



                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                              June 30,                December 31,
            ASSETS                                                              1997                      1996
                                                                             -----------              --------
<S> <C>
Land and buildings on operating
  leases, less accumulated
  depreciation of $1,301,771 and
  $1,143,698                                                                 $20,979,395             $21,082,468
Net investment in direct financing
  leases                                                                      13,724,702              13,789,036
Investment in joint ventures                                                   2,504,811               2,496,749
Cash and cash equivalents                                                      1,744,454               1,800,601
Receivables, less allowance for
  doubtful accounts of $27,043 and
  $23,395                                                                        192,902                 202,908
Prepaid expenses                                                                  14,985                   6,786
Organization costs, less accumulated
  amortization of $9,465 and $8,465                                                  535                   1,535
Lease costs, less accumulated
  amortization of $478 for 1997                                                   23,574                      -
Accrued rental income                                                          2,225,202               1,963,055
                                                                             -----------             -----------

                                                                             $41,410,560             $41,343,138
                                                                             ===========             ===========


LIABILITIES AND PARTNERS' CAPITAL

Accounts payable                                                             $     8,702             $     9,303
Accrued and escrowed real
  estate taxes payable                                                            23,785                  14,706
Distributions payable                                                            956,252                 956,252
Due to related parties                                                             3,383                   2,981
Rents paid in advance                                                             95,007                  69,790
                                                                             -----------             -----------
    Total liabilities                                                          1,087,129               1,053,032

Partners' capital                                                             40,323,431              40,290,106
                                                                             -----------             -----------

                                                                             $41,410,560             $41,343,138
                                                                             ===========             ===========



</TABLE>


            See accompanying notes to condensed financial statements.

                                        1

<PAGE>



                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                         CONDENSED STATEMENTS OF INCOME

<TABLE>
<CAPTION>

                                                            Quarter Ended                       Six Months Ended
                                                              June 30,                             June 30,
                                                     1997             1996               1997              1996
                                                  ----------       ----------         ----------        -------
<S> <C>
Revenues:
  Rental income from
    operating leases                              $  604,177       $  611,972         $1,207,972        $1,260,485
  Earned income from direct
    financing leases                                 410,956          425,691            821,923           859,185
  Contingent rental income                            20,546           13,409             25,963            22,218
  Interest and other income                           20,177           54,218             40,974            78,523
                                                  ----------       ----------         ----------        ----------
                                                   1,055,856        1,105,290          2,096,832         2,220,411
                                                  ----------       ----------         ----------        ----------

Expenses:
  General operating and
    administrative                                    42,054           47,250             80,776            90,214
  Professional services                                5,505           10,305             12,162            15,932
  Management fees to
    related parties                                   10,051           10,033             19,964            20,087
  Real estate taxes                                       -             5,806              1,410             5,806
  State and other taxes                                  406              514             18,496            18,472
  Depreciation and
    amortization                                      80,102           74,471            159,551           156,420
                                                  ----------       ----------         ----------        ----------
                                                     138,118          148,379            292,359           306,931
                                                  ----------       ----------         ----------        ----------

Income Before Equity in
  Earnings of Joint
  Ventures and Loss on
  Sale of Land and Building                          917,738          956,911          1,804,473         1,913,480

Equity in Earnings of
  Joint Ventures                                      70,949           35,287            141,356            55,297

Loss on Sale of Land and
  Building                                                -           (15,355)                -            (15,355)
                                                  ----------       ----------         ----------        ----------

Net Income                                        $  988,687       $  976,843         $1,945,829        $1,953,422
                                                  ==========       ==========         ==========        ==========

Allocation of Net Income:
  General partners                                $    9,887       $    9,873         $   19,458        $   19,639
  Limited partners                                   978,800          966,970          1,926,371         1,933,783
                                                  ----------       ----------         ----------        ----------

                                                  $  988,687       $  986,843         $1,945,829        $1,953,422
                                                  ==========       ==========         ==========        ==========

Net Income Per Limited
  Partner Unit                                    $     0.22       $     0.21         $     0.43        $     0.43
                                                  ==========       ==========         ==========        ==========

Weighted Average Number
  of Limited Partner
  Units Outstanding                                4,500,000        4,500,000          4,500,000         4,500,000
                                                  ==========       ==========         ==========        ==========


</TABLE>








            See accompanying notes to condensed financial statements.

                                        2

<PAGE>



                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL
<TABLE>
<CAPTION>


                                                                        Six Months Ended               Year Ended
                                                                            June 30,                  December 31,
                                                                              1997                        1996
                                                                        ----------------              --------
<S> <C>
General partners:
  Beginning balance                                                      $   152,889                 $   113,356
  Net income                                                                  19,458                      39,533
                                                                         -----------                 -----------
                                                                             172,347                     152,889
                                                                         -----------                 -----------

Limited partners:
  Beginning balance                                                       40,137,217                  40,058,715
  Net income                                                               1,926,371                   3,903,510
  Distributions ($0.43 and $0.85
    per limited partner unit,
    respectively)                                                         (1,912,504)                 (3,825,008)
                                                                         -----------                 -----------
                                                                          40,151,084                  40,137,217
                                                                         -----------                 -----------

Total partners' capital                                                  $40,323,431                 $40,290,106
                                                                         ===========                 ===========




</TABLE>


            See accompanying notes to condensed financial statements.

                                        3

<PAGE>



                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                       CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>


                                                                                              Six Months Ended
                                                                                                  June 30,
                                                                                   1997                   1996
                                                                               -----------             -------
<S> <C>
Increase (Decrease) in Cash and Cash
  Equivalents:

    Net Cash Provided by Operating
      Activities                                                               $ 1,931,238             $ 1,930,975
                                                                               -----------             -----------

    Cash Flows From Investing
      Activities:
        Proceeds from sale of land and
          building                                                                      -                1,640,000
        Additions to land and building
          on operating leases                                                      (55,000)                     -
        Investment in joint venture                                                     -               (1,655,928)
        Collections on loan to tenant
          of joint venture                                                           4,171                   3,774
        Payment of lease costs                                                     (24,052)                     -
                                                                               -----------             ----------
            Net cash used in investing
              activities                                                           (74,881)                (12,154)
                                                                               -----------             -----------

    Cash Flows From Financing
      Activities:
        Distributions to limited
          partners                                                              (1,912,504)             (1,957,504)
                                                                               -----------             -----------
            Net cash used in
              financing activities                                              (1,912,504)             (1,957,504)
                                                                               -----------             -----------

Net Decrease in Cash and Cash
  Equivalents                                                                      (56,147)                (38,683)

Cash and Cash Equivalents at
  Beginning of Period                                                            1,800,601               1,716,203
                                                                               -----------             -----------

Cash and Cash Equivalents at End of
  Period                                                                       $ 1,744,454             $ 1,677,520
                                                                               ===========             ===========

Supplemental Schedule of Non-Cash
  Financing Activities:

    Distributions declared and unpaid
      at end of period                                                         $   956,252             $   956,252
                                                                               ===========             ===========



</TABLE>




            See accompanying notes to condensed financial statements.

                                        4

<PAGE>



                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
              Quarters and Six Months Ended June 30, 1997 and 1996


1.       Basis of Presentation:

         The accompanying unaudited condensed financial statements have been
         prepared in accordance with the instructions to Form 10-Q and do not
         include all of the information and note disclosures required by
         generally accepted accounting principles. The financial statements
         reflect all adjustments, consisting of normal recurring adjustments,
         which are, in the opinion of management, necessary to a fair statement
         of the results for the interim periods presented. Operating results for
         the quarter and six months ended June 30, 1997, may not be indicative
         of the results that may be expected for the year ending December 31,
         1997. Amounts as of December 31, 1996, included in the financial
         statements, have been derived from audited financial statements as of
         that date.

         These unaudited financial statements should be read in conjunction with
         the financial statements and notes thereto included in Form 10-K of CNL
         Income Fund XII, Ltd. (the "Partnership") for the year ended December
         31, 1996.

                                        5

<PAGE>



ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                  CONDITION AND RESULTS OF OPERATIONS

         CNL Income Fund XII, Ltd. (the "Partnership") is a Florida limited
partnership that was organized on August 20, 1991, to acquire for cash, either
directly or through joint venture arrangements, both newly constructed and
existing restaurants, as well as properties upon which restaurants were to be
constructed (the "Properties"), which are leased primarily to operators of
national and regional fast-food and family-style restaurant chains. The leases
are triple-net leases, with the lessees generally responsible for all repairs
and maintenance, property taxes, insurance and utilities. As of June 30, 1997,
the Partnership owned 48 Properties, including interests in four Properties
owned by joint ventures in which the Partnership is a co-venturer.

Liquidity and Capital Resources

         The Partnership's primary source of capital for the six months ended
June 30, 1997 and 1996, was cash from operations (which includes cash received
from tenants, distributions from joint ventures, and interest and other income
received, less cash paid for expenses). Cash from operations was $1,931,238 and
$1,930,975 for the six months ended June 30, 1997 and 1996, respectively.

         Other sources and uses of capital included the following during the six
months ended June 30, 1997.

         In March 1997, the Partnership entered into a new lease for the
Property in Tempe, Arizona. In connection therewith, the Partnership incurred
$55,000 in renovation costs during the six months ended June 30, 1997. The
renovations were completed in May 1997.

         Currently, rental income from the Partnership's Properties is invested
in money market accounts or other short-term, highly liquid investments pending
the Partnership's use of such funds to pay Partnership expenses or to make
distributions to the partners. At June 30, 1997, the Partnership had $1,744,454
invested in such short-term investments, as compared to $1,800,601 at December
31, 1996. The funds remaining at June 30, 1997, after payment of distributions
and other liabilities, will be used to meet the Partnership's working capital
and other needs.

         Total liabilities of the Partnership increased to $1,087,129 at June
30, 1997, from $1,053,032 at December 31, 1996, primarily as the result of an
increase in rents paid in advance during the six months ended June 30, 1997. The
general partners believe that the Partnership has sufficient cash on hand to
meet its current working capital needs.

         Based on cash from operations, the Partnership declared distributions
to the limited partners of $1,912,504 for each of the six months ended June 30,
1997 and 1996 ($956,252 for each of the quarters ended June 30, 1997 and 1996).
This represents distributions for each applicable six months of $0.43 per unit

                                        6

<PAGE>



Liquidity and Capital Resources - Continued

($0.21 per unit for each applicable quarter). No distributions were made to the
general partners for the quarters and six months ended June 30, 1997 and 1996.
No amounts distributed or to be distributed to the limited partners for the six
months ended June 30, 1997 and 1996, are required to be or have been treated by
the Partnership as a return of capital for purposes of calculating the limited
partners' return on their adjusted capital contributions. The Partnership
intends to continue to make distributions of cash available for distribution to
the limited partners on a quarterly basis.

         The Partnership's investment strategy of acquiring Properties for cash
and leasing them under triple-net leases to operators who generally meet
specified financial standards minimizes the Partnership's operating expenses.
The general partners believe that the leases will continue to generate cash flow
in excess of operating expenses.

         The general partners have the right, but not the obligation, to make
additional capital contributions if they deem it appropriate in connection with
the operations of the Partnership.

Results of Operations

         During the six months ended June 30, 1996, the Partnership owned and
leased 45 wholly owned Properties (including one Property in Houston, Texas,
which was sold in April 1996) and during the six months ended June 30, 1997, the
Partnership owned and leased 44 wholly owned Properties to operators of
fast-food and family-style restaurant chains. In connection therewith, during
the six months ended June 30, 1997 and 1996, the Partnership earned $2,029,895
and $2,119,670, respectively, in rental income from operating leases and earned
income from direct financing leases from these Properties, $1,015,133 and
$1,037,663 of which was earned during the quarters ended June 30, 1997 and 1996,
respectively. The decrease in rental and earned income is primarily attributable
to a decrease of approximately $4,700 and $51,800 during the quarter and six
months ended June 30, 1997, respectively, as a result of the sale of the
Property in Houston, Texas, in April 1996.

         Rental and earned income also decreased approximately $10,500 and
$27,900 during the quarter and six months ended June 30, 1997, respectively, as
a result of the fact that the tenant of the Property in Tempe, Arizona, declared
bankruptcy and ceased operations of the restaurant business located on the
Property in June 1996. In March 1997, the Partnership entered into a new lease
for the Property in Tempe, Arizona with a new tenant to operate the Property and
rental payments are expected to commence in July 1997. Consequently, the
Partnership expects rental and earned income to increase during the remainder of
1997 and in subsequent years.




                                        7

<PAGE>



Results of Operations - Continued

         For the six months ended June 30, 1997 and 1996, the Partnership also
earned $25,963 and $22,218, respectively, in contingent rental income, $20,546
and $13,409 of which was earned during the quarters ended June 30, 1997 and
1996, respectively.

         Interest and other income was $40,974 and $78,523 for the six months
ended June 30, 1997 and 1996, respectively, of which $20,177 and $54,218 was
earned for the quarters ended June 30, 1997 and 1996, respectively. The decrease
in interest and other income is primarily attributable to the Partnership
granting certain easement rights to the owner of the Property adjacent to the
Partnership's Property in Black Mountain, North Carolina, in exchange for
$25,000 during the quarter and six months ended June 30, 1996.

         For the six months ended June 30, 1997 and 1996, the Partnership owned
and leased four Properties indirectly through joint venture arrangements. In
connection therewith, during the six months ended June 30, 1997 and 1996, the
Partnership earned $141,356 and $55,297, respectively, attributable to net
income earned by these joint ventures, $70,949 and $35,287 of which was earned
during the quarters ended June 30, 1997 and 1996, respectively. The increase in
net income earned by joint ventures is primarily due to the fact that the
Partnership invested in Middleburg Joint Venture in May 1996.

         Operating expenses, including depreciation and amortization expense,
were $292,359 and $306,931 for the six months ended June 30, 1997 and 1996,
respectively, of which $138,118 and $148,379 were incurred for the quarters
ended June 30, 1997 and 1996, respectively. The decrease in operating expenses
during the quarter and six months ended June 30, 1997, as compared to the
quarter and six months ended June 30, 1996, is primarily attributable to a
decrease in accounting and administrative expenses associated with operating the
Partnership and its Properties.

                                        8

<PAGE>



                           PART II. OTHER INFORMATION


Item 1.           Legal Proceedings.  Inapplicable.

Item 2.           Changes in Securities.  Inapplicable.

Item 3.           Defaults upon Senior Securities.  Inapplicable.

Item 4.           Submission of Matters to a Vote of Security Holders.

                  Inapplicable.

Item 5.           Other Information.  Inapplicable.

Item 6.           Exhibits and Reports on Form 8-K.

                  (a)      Exhibits - None.

                  (b)      No reports on Form 8-K were filed during the
                           quarter ended June 30, 1997.

                                        9

<PAGE>


                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

         DATED this 6th day of August, 1997.


                            CNL INCOME FUND XII, LTD.

                               By:      CNL REALTY CORPORATION
                                        General Partner


                                        By:      /s/ James M. Seneff, Jr.
                                        ---------------------------------
                                                 JAMES M. SENEFF, JR.
                                                 Chief Executive Officer
                                                 (Principal Executive Officer)


                                        By:      /s/ Robert A. Bourne
                                        ---------------------------------
                                                 ROBERT A. BOURNE
                                                 President and Treasurer
                                                 (Principal Financial and
                                                 Accounting Officer)